Victoria's Secret & Co.VSCO

Victoria's Secret & Co. Fair Value Disclosure

10-KFiled Mar 20, 20262 min read
Fair Value Measurements
Cash and Cash Equivalents include cash on hand, deposits with financial institutions, credit and debit card receivables and highly liquid investments with original maturities of 90 days or less. The Company’s Cash and Cash Equivalents are considered Level 1 fair value measurements as they are valued using unadjusted quoted prices in active markets for identical assets.
The following table provides a summary of the principal value and estimated fair value of outstanding debt as of January 31, 2026 and February 1, 2025:
January 31,
2026		February 1,
2025
 (in millions)
Principal Value$983 $987 
Fair Value, Estimated (a)971 940 
________________
(a)The estimated fair value of the Company’s publicly traded debt is based on reported transaction prices which are considered Level 2 inputs in accordance with ASC 820, Fair Value Measurement. The estimates presented are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
Management believes that the carrying values of accounts receivable, accounts payable and accrued expenses approximate fair value because of their short maturity.
Recurring Fair Value Measurements
The following table provides a summary of the Company’s contingent consideration recognized at fair value related to the Adore Me acquisition as of January 31, 2026, February 1, 2025 and February 3, 2024 (in millions):
Balance Sheet LocationMeasurement LevelJanuary 31,
2026		February 1,
2025		February 3,
2024
Accrued Expenses and OtherLevel 3$— $— $74 
Other Long-term LiabilitiesLevel 3— — 18 
The estimated fair value of the contingent consideration related to the Adore Me acquisition was valued using a Scenario-Based method and a Monte Carlo simulation prior to the final amounts being paid. This method utilized inputs including discount rates, estimated probability of achievement of certain milestones, forecasted revenues, forecasted EBITDA and volatility rates. These are considered Level 3 inputs in accordance with ASC 820, Fair Value Measurement. Changes in the fair value of the contingent consideration were recorded within General, Administrative and Store Operating Expenses on the Consolidated Statements of Income. For additional information regarding the contingent consideration, see

Historical Timeline

Fiscal YearFiled
2026Mar 20, 2026Showing above
2025Mar 21, 2025
2024Mar 22, 2024
2023Mar 17, 2023
2022Mar 18, 2022

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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